US Pushes for Reopening Aerospace Sector

The aerospace and automotive industry in Mexico have been classified as essential for the defense sector by US authorities. In an interview with the El Economista, the President in Queretaro of the Employers' Confederation of the Mexican Republic (COPARMEX), Lorena Jiménez Salcedo, explained that in the face of pressure brought by the US and Canada, the sectors are planning protocols to resume activities safely. Also, Jiménez said there are clients who are already calling for the sector’s reactivation. 

Now let’s jump into the Week in Aerospace!

ICAO Calls for “Key Worker” Designation for Air Personnel
To ensure the efficient transportation of necessary goods in these troubling times, ICAO joined the International Labour Organization (ILO) and the International Maritime Organization (IMO) in issuing a statement calling for governments to designate all air and sea freight operators as “key workers.” For the aviation industry, this would include pilots, air traffic controllers and licensed maintenance technicians, which in 2019 amounted to 887,000 professionals, according to ICAO. “We are seeking the support of governments to facilitate crew changes, operations essential to maintain the global cargo supply chains and operations related to humanitarian aid, medical and relief flights,” said the statement.

LATAM Airlines Files for Bankruptcy

The crisis is having a much deeper impact on the region than expected. Two weeks ago, the second largest airline in the region, Avianca, filed for bankruptcy protection. Now, the largest airline in the region followed suit. LATAM Airlines, created in 2011 after the fusion of Brazilian TAM Airlines and Chilean LAN Airlines, filed for Chapter 11 in a US court on May 26. What is most surprising is that unlike Avianca and Virgin Australia, other airlines that entered administration during the COVID-19 crisis, before filing for bankruptcy LATAM Airlines had reported profits for the previous years. “LATAM entered the COVID-19 pandemic as a healthy and profitable airline group, yet exceptional circumstances have led to a collapse in global demand that has not only brought aviation to a virtual standstill, but has also changed the industry for the foreseeable future,” says Roberto Alvo, Chief Executive Officer of LATAM.

Reactivation Plan Necessary for Mexico’s Aviation Industry: AFAC    
All local airlines have reported significant drops in demand for flights. Mexican airports have also seen a substantial decrease in the number of passengers, with Mexico’s largest aviation hub, Mexico City International Airport (AICM), reporting a 92.8 percent drop in passengers during April. Mexico’s airport groups have reported similar data. These sharp drops in passengers have raised alarms in the industry, leading to calls for support from government institutions. Mexico’s airline association CANAERO had requested support from the federal government to help Mexico’s ailing aviation industry in the form of tax relief and other stimuli, but has yet to receive an answer. In the meantime, the country’s recently recreated AFAC is developing a reactivation plan that aims to help the industry recover.